Kiwi MPs from both sides of the aisle are leading hundreds of parliamentarians from around the world in calling for China to be held to account over its "bullying" of Australia.

A diplomatic dispute between the two countries escalated rapidly this week after China's foreign minister Zhao Lijian posted a doctored image of an Australian soldier holding a knife to a young Afghan boy's throat to Twitter.

The image - a reference to a recent report alleging Australian special forces unlawfully killed 39 Afghans - appears to be a reaction to Australian measures to defend itself from political interference by the Chinese Communist Party.

Having already imposed tariffs on its wine and barley exports, China has threatened to impose even more economic sanctions against Australia - a burdensome prospect for a country that exports 39 percent of its goods there.

National's Simon O'Connor and Labour's Louisa Wall are two of 38 MPs from Europe, Africa, North America, Asia and Australasia tasked with co-chairing the Inter-Parliamentary Alliance on China (IPAC).

IPAC is made up of more than 200 MPs representing 19 countries. The group was formed in June this year to foster greater collaboration between nations to ensure China is held to the same international rules-based order as other nations.

As part of her role, Wall recently starred in a campaign calling on the rest of the world to buy Australian wine for the month of December, after China introduced a tariff of up to 212 percent against its wine producers.

"After a hard day's work, nothing beats a glass of New Zealand pinot," she says in a video posted to Twitter in which several MPs extol their countries' national drinks before urging nations to forego them in favour of Australian wine.

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• China 'surprised' New Zealand weighed into Australian soldier image debate

Speaking in the video, Australian Labour Senator Kimberley Kitching accuses China of cancelling "a whole range of Australian imports in an attempt to bully us into abandoning our values".

"This isn’t just an attack on Australia, it is an attack on free countries everywhere," she says.

Before the China-Australia dispute, IPAC also ran campaigns opposing China's treatment of Uighur Muslims in Xinjiang, the security legislation imposed on Hong Kong and reports of forced labour in the Tibetan Autonomous Region.